The Insurance Act 2015 (‘the Act’) received Royal Assent on 12 February 2015 and comes into force on 12 August 2016 applying to all contracts of commercial insurance entered into or varied on or after this date.
The Act makes changes to the following areas of commercial insurance law:
- the duty of disclosure and remedies available for material non-disclosure;
- the incidence and effect of warranties;
- the remedies available for fraudulent claims;
- the effects of a breach of the duty of utmost good faith;
- restricts an insurers’ ability to contract out of the Act, and
- amends a number of other pieces of legislation, e.g. the Third Party (Rights Against Insurers) Act 2010 which is now expected to come into force as a result
The new Act brings welcome changes and updates to insurance law. But there are some major challenges for buyers too, particularly in meeting the new disclosure obligations. Business policyholders should review their existing policies, evaluate their existing disclosure processes and liaise with their insurance brokers to ensure that they are ready for the changes and can provide any required additional information.